Recycling is Way More Fun With TerraCycle’s Tom Szaky

TerraCycle CEO and founder, Princeton, NJ

For green entrepreneur Tom Szaky, his interest in recycling started in college about 16 years ago—with worm poop and a few childhood friends. “We were growing up in Toronto. When we got into the universities we wanted to get into, we decided to start growing ‘certain plants’ in our basement,” he says.

But when they couldn’t quite get those indoor plants to thrive, one of Szaky’s friends decided to try using one of nature’s great recyclers to jumpstart their efforts—worms. Specifically, he used their castings, the nutrient-rich recycled organic material that has passed through a worm’s body, as fertilizer. The plan worked. “That was the genesis. That was how our company began,” Szaky says.

Thus, TerraCycle was born. They started small, selling liquid worm castings through companies like Walmart and Home Depot, but have since evolved, branching out from soda bottles and collecting many more former waste materials. The company’s in-house R&D department and laboratories then come up with closed loop systems for turning collected waste into something new. Today, TerraCycle has become a global leader in the recycling industry. “Since then we’ve had straight growth. We operate in 23 countries around the world, and we’ve had really good success,” Szaky says.

[Photo: Courtesy of TerraCycle]

Across the world, their waste collection programs work for even the hardest to recycle items—think baby diapers and cigarette butts—keeping them out of landfills and oceans with innovative ways to reuse them, like turning them into tote bags or park benches. Although they do produce products, like flower planters made from crushed computers and fax machines, TerraCycle’s main focus is on the waste itself.

A big part of how they do this is through partnerships with large and small companies, retailers, municipalities, and regular people. On a small scale, individuals can send their hard-to-recycle waste (like alkaline batteries or automotive parts) to TerraCycle for a fee, knowing their waste will be recycled into new products. Or, individuals can get involved in one of the company’s many free recycling programs sponsored by a company, organization, or municipality looking to reduce their environmental impact.

Even the largest companies are getting onboard, Szaky says, knowing doing so will make their products and image that much greener and more attractive to an increasingly environmentally aware market. Organizations like Colgate, PepsiCo, and Brita are sponsoring collections that allow consumers to send in their spent products to be recycled for free. Municipal programs such as cigarette butt collection stations are also popping up in cities around the world, as are industrial waste solutions.

TerraCycle keeps hard-to-recycle items out of landfills and turns trash into treasure. Even the company’s New Jersey office is made of reused and recycled materials. [Photo: Dean Innocenzi]

As TerraCycle has evolved, it’s become known not only for its methods and products but also for its company culture. In the Trenton, New Jersey office, everything from walls to desks are made of reused and recycled materials, local graffiti artists redecorate the facility on a regular basis, and employees’ work lives have become something of a cult hit with their reality TV show, Human Resources.

“Every aspect of our business echoes our mission,” Szaky says. “Whether it’s our physical office being made entirely of garbage or our belief in transparency, where not only our walls are transparent but the way our people interact is completely transparent.”

Although the company has come far from selling worm poop in old soda bottles (and yes they do still offer their famous liquid fertilizers), their mission has remained the same—to solve the problem of waste no matter what it takes.

“Do this because it will fulfill your key goals. It will help you grow your business.”

gb&d: One of TerraCycle’s most prominent brand statements is about “solving for waste.” How are you doing that in ways other companies aren’t?

Tom Szaky: We realized, after a few years building a multimillion dollar worm poop business, that if we focus only on the product as the hero, we won’t necessarily be able to solve for all types of garbage because it will take the very best types of garbage to make, effectively, the very best products. So we changed our model and refocused on the garbage as the hero. We built a business model around figuring out how to collect it and process it in a circular way, primarily focusing on things that are not typically recyclable.

gb&d: As a green business owner, what is your biggest challenge?

Szaky: It all has to do with making people care. We are trying to solve something—garbage—that goes out of sight, out of mind. We are asking a person to invest their time and money to be able to do something with it that’s significantly better but not nearly as simple. And that’s not necessarily easy.

gb&d: How have you convinced the more than 63 million people who’ve participated in your collection programs to care?

Szaky: It’s all about making it personal to the individual. Because the environment is such a broad topic, it’s sometimes very difficult for people to figure out what’s in it for them—whether that individual wants to fulfill their personal sustainability goals or something else. Many entrepreneurs, especially social entrepreneurs, they do the inverse. They go around saying, “Please, help me because it’s the right thing to do,” and that really just doesn’t go far.

gb&d: What new TerraCycle developments are you most excited about?

Szaky: Last month at the World Economic Forum, we launched the world’s first shampoo bottle with Head & Shoulders made from 25% ocean plastic. This is an interesting case study because ocean plastic is especially difficult to source and it’s expensive, more expensive than recycled plastics. And it’s less capable. This plastic has been floating in the ocean. It’s degraded. So why would P&G put a plastic into the world’s top shampoo brand that is both more expensive and turns their iconic white bottles into gray ones? The reason is that it will actually create value for them. Rather than investing capital in TV commercials or advertising, they’re investing in something like this. Now, if we just went to them and said, “Hey, guys, ocean plastic is a problem.” They’d say, “We agree, but we don’t see a business way to solve it.” Instead, we go in and say, “If you do something with ocean plastic, you can really win big against your competition.”

gb&d: You’ve gone into countries like Mexico and Brazil and offered recycling programs with great success. How did you approach those markets?

Szaky: We offer services no one ever offered. So when we go to places like Mexico or Brazil, or just recently China, there’s usually very, very big interest in that. The issue is getting someone to pay for it. In China, for example, Colgate is the company we work with who funds our ability to nationally collect and recycle toothpaste tubes.

gb&d: How do you get these large corporations behind the idea?

Szaky: It depends on the stakeholder. If it’s a consumer products company, what we pitch them is that by working with us you can make your waste nationally recyclable and that will allow you to increase your market share, win at retail, and beat the competition. With retailers as a stakeholder, and we work with about 100,000 retailers now on collecting waste at their stores, it’s more about how to drive foot traffic. But in each case, you’ll notice we don’t go in and say, “Do it because it’s the right thing to do” or “Do it for sustainability.” We say, “Do this because it will fulfill your key goals. It will help you grow your business.” If you can’t nail that, then you have to be able to demonstrate to them that not caring will cause the inverse of those benefits. And that’s the unlocking mechanism.